Sustainable seafood is needed to nourish the world
The world needs more animal proteins and seafood can fulfill an important role to that respect. Entrepreneurs and financiers have to deal with the triple helix: bringing together profitability, sustainability and risk assessment.
Seas cover 70% of our planet. Could they provide a solution for the ongoing increasing demand for animal proteins? Because as the population and the standards of living rise across the globe, so will rise the demand for animal proteins. Compared to 2011 figures, by 2020 the world will need to find 20 million to 25 million additional tonnes of seafood each year to feed the world's population. Despite many technological improvements global wild catch production is unlikely to grow much further than its current 90 million tonnes per annum. So growth in seafood production can only come from one source: aquaculture.
The topic is important for many of Rabobank’s customers. As a global food and agri bank Rabobank has clients among processors and fisheries in Latin America, in North America as well as Europe. More than 100 years ago some of the Dutch local Rabobanks were even founded in small villages near the sea, which were fully occupied with fishing. And today entrepreneurs in those villages still are active in fishing.
Rabobank helps fishermen achieve higher levels of business professionalism by providing not only money, but also knowledge and highly targeted advice: how to interface with traders and processors, how to organise communities and increase their leverage, how to build better futures.
That is why Rabobank believes in a two-pronged approach to fishery finance. ‘One: encouraging consolidation among vertical integrators, by offering access to knowledge as well as access to finance. And two: by helping those at the beginning of the chain, the fishermen, to improve their position within their chains. Here, Rabobank’s deep knowledge of agricultural co-operatives is proving immensely valuable’, says Bas Rüter, Sustainability Director at Rabobank. Rabobank acts together with partners, such as the World Wildlife Fund.
Innovation, from breeding to packaging
The key to secure long term sustainable aquaculture production is innovation. ‘Aquaculture needs to recognize nature’s constraints if the industry wants to be economically viable in the long run’, says Jeroen Leffelaar, Animal Protein Senior Relationship Manager at Rabobank. Entrepreneurs and research institutes are already making great strides in the areas of processing and packaging, fish breeding, bio-based food chemistry, and ICT.
‘Aquaculture needs to recognize nature’s constraints if the industry wants to be economically viable in the long run.’
Extending shelf life
Once the fish has been caught or farmed in Chile, Northern Europe or Canada, it has to be shipped to markets across the world. Innovations change the face of industry. One of Rabobank’s customers developed a system that creates and maintains a very high CO2 and extremely low oxygen atmosphere as the fish are transported. This extends freshness by up to 34 days. New markets can be reached, but competition and price pressure increase.
In aquaculture, so on the farming side, innovations are important to safeguard quality levels and improving fish health and sustainability. Several Rabobank clients are involved in new feeding methods for aquaculture. Insects may serve as a nutritional source for farmed fish. Or in fish feed low value vegetable ingredients may replace fishing mail and fish oil.
Improving the good shape of the fish stock
Fisheries in wild catch also have to invest in innovation, to maintain the catch volumes while reducing fuel consumption and preserving the natural conditions. In conventional trawl fishing methods for flatfish fishing nets are dragged on the bottom of the sea. With the innovative pulsing techniques fishes are startled by electrical impulses (pulses) delivered through strands of electrodes. This innovation reduces fuel consumption dramatically while improving the good shape of the fish stock.
There are, however, many risks attached to aquaculture limiting appetite from banks and investors to finance fish farms. Although fishing occurred 2,000 years ago already, it remained small size family business for many centuries. International competition and integrated chains are rather new. They face increasing demand at one hand, but at the other hand have to manage fish health and diseases, environmental impact and unstable cash flows. Mitigating risk is a priority. Sharing best practices and knowledge is crucial.
Global Salmon Initiative
A major step in the farmed salmon industry was taken in 2013, when 15 salmon producing companies joined forces in the Global Salmon Initiative (GSI). Together, they make up 70% of the world's farmed salmon output and agreed to have all their farms certified to the Aquaculture Stewardship Council (ASC) certification standards by 2020. Jeroen Leffelaar: ‘Working towards certification means the industry is addressing what probably is the triple helix of aquaculture: bringing together profitability, sustainability and risk assessment.’
Better continuity of business model
This is the way for the seafood sector to move forward. By better incorporating sustainability criteria into the client approach and risk assessment, Rabobank can make more informed decisions. But the bank’s goal is to show clients that risk and sustainability assessment for them is a help too, to gain greater insight into the continuity of their business and therewith continuity for seafood production in general.